North Dakota HOA Reserve Studies
| Reserve study factor | North Dakota treatment |
|---|---|
| 1. Statutory reserve study required | Not required by statute. No reserve-study mandate exists in the North Dakota Condominium Ownership Act or elsewhere in the Century Code; the recorded declaration and board fiduciary duty govern reserve practice.1 |
| 2. Communities covered | No reserve statute applies to any community type. N.D. Cent. Code ch. 47-04.1 governs condominiums; recorded CC&Rs and, at the corporate level, the Nonprofit Corporation Act (ch. 10-33) govern non-condominium HOAs.2 |
| 3. Initial study deadline | Not required by statute.1 |
| 4. Study update interval | Not required by statute.1 |
| 5. On-site / physical inspection interval | Not required by statute.1 |
| 6. Preparer qualification | Not required by statute.1 |
| 7. Reserve funding required | Not required by statute. Any funding obligation arises from the recorded declaration and board fiduciary duty.1 |
| 8. Funding standard | Not required by statute.1 |
| 9. Component / useful-life scope | Not required by statute.1 |
| 10. Annual member disclosure | No reserve-specific annual disclosure required by statute. For condominiums, the bylaws govern assessment of expenses and must be made available to every owner (§ 47-04.1-07).3 |
| 11. Resale / buyer disclosure | Required by statute. Senate Bill 2229 (2025), codified at N.D. Cent. Code § 47-10-02.3 and effective August 1, 2025, requires the seller of a condominium unit or a property in an HOA or condominium project to disclose the reserve and capital funds available, whether the association uses a reserve study, and the current operating and reserve budgets.4 |
| 12. Reserve account protections | Not required by statute.1 |
| 13. Waiver or underfunding mechanism | Not required by statute (no funding mandate exists to waive).1 |
| 14. Enforcement / penalty | No reserve-study penalty exists. For resale disclosure under § 47-10-02.3, the purchase contract is voidable by the buyer until the documents are provided and for five days after receipt. Contract (the declaration) and director fiduciary duty (§ 10-33-45) enforce reserve funding.4,5 |
| 15. Primary statutory citation(s) | N.D. Cent. Code ch. 47-04.1 (condominiums); ch. 10-33 and § 10-33-45 (nonprofit corporate governance and director duty); § 47-10-02.3 (SB 2229, 2025, resale disclosure).2,4 |
Section 1: Overview — Reserve study requirements in North Dakota
North Dakota does not require a community association to commission a reserve study or to fund reserves. The Century Code stays quiet on the question, so the recorded declaration and the board's fiduciary duty set reserve practice instead.1 Condominiums answer to the North Dakota Condominium Ownership Act, N.D. Cent. Code chapter 47-04.1. It is a traditional condominium statute — it covers formation, common areas, assessments, and liens, but it says nothing about reserves.2 North Dakota has never enacted a comprehensive planned-community statute, so no dedicated state act covers a non-condominium HOA.2 Those associations follow their recorded CC&Rs and, when they incorporate as nonprofits, the North Dakota Nonprofit Corporation Act, chapter 10-33 — a law that supplies corporate-governance rules, not reserve requirements.6 Nationally, North Dakota sits in the no-mandate group. That sets it apart from the hard-mandate states, which fix study intervals and funding rules, and from the disclosure-mandate states, which require reserve information without forcing a study.1 The sections that follow walk through the condominium statute, the missing planned-community statute, the declaration-and-fiduciary backstop, the obligations each community type carries, recent activity in the legislature and the courts, and how North Dakota compares with other states.
Section 2: The reserve framework under North Dakota law
2A. The North Dakota Condominium Ownership Act and reserves
N.D. Cent. Code chapter 47-04.1 applies to condominiums, which the statute defines as estates that combine an undivided common interest with a separate interest in a unit.2 The Act requires a recorded declaration and bylaws. Section 47-04.1-07 tells the unit owners or the administrative body to set out, in the bylaws, how they will maintain the common elements, assess expenses, pay losses, and handle hazard-insurance proceeds — and it requires the association to make those bylaws available to every owner.3 Section 47-04.1-11 turns a reasonable common-expense assessment, levied under the recorded declaration and bylaws, into a debt of the owner and a lien on the unit once the association records it.3 The Act reaches a number of other subjects — partition limits, withdrawal of property, lender approval of amendments, political signs, electric-vehicle charging stations — but it never requires a reserve study, sets a funding standard, or mandates reserve-specific disclosures.2 A read through the full chapter confirms it, and the Community Associations Institute's national survey of state reserve-fund laws lists North Dakota as a state with no statutory requirement to conduct a reserve study and none to fund reserves.1 So reserve levels at a North Dakota condominium come down to what the declaration and bylaws require and how prudently the board sets its assessments.
2B. The absence of a planned-community statute
North Dakota has not enacted a comprehensive planned-community or common-interest-community statute, and it has not adopted the Uniform Common Interest Ownership Act.1 A detached-home subdivision, a townhome community, or a master-planned development that is not a condominium has no dedicated state statute governing its assessments, budgets, or reserves. Communities like these answer to their recorded declaration of covenants, conditions, and restrictions — a contract that binds every owner — and, when they incorporate as nonprofits, to the North Dakota Nonprofit Corporation Act, chapter 10-33.6 To figure out which framework governs a given community, start with one question: did someone submit the property to a condominium regime by recording a declaration under chapter 47-04.1?2 If they did, the condominium Act and the recorded instruments control. If they did not, the community is a non-condominium HOA that runs on its CC&Rs and corporate law. Either way, no state statute imposes a reserve study or reserve funding. The two frameworks differ in where governance authority comes from, not in whether a reserve mandate exists.
2C. The declaration, corporate law, and fiduciary backstop
Because no statute imposes reserve requirements, the recorded declaration becomes the primary source of any reserve obligation in North Dakota, with the bylaws filling in the details.3 Precedence runs in a clear order: the Century Code first — though it says almost nothing about reserves — then the recorded declaration and bylaws, then board policy adopted under those instruments. Where the declaration names a reserve account, sets a contribution rate, or fixes a study cadence, those terms bind owners as equitable servitudes and as contract terms.2 The Nonprofit Corporation Act works at the corporate level. Section 10-33-45 requires a director to discharge the duties of the office in good faith, in a manner the director reasonably believes serves the best interests of the corporation, and with the care an ordinarily prudent person would use in a like position under similar circumstances.5 Put that standard to work on reserves, and a board's choice to fund, underfund, or study them gets measured against the prudent-person test and the governing documents — not against a statutory funding formula. The practical result: the declaration and the board's judgment set reserve practice, and a board that ignores foreseeable capital needs invites a fiduciary claim even though no reserve statute exists.
Section 3: Compliance obligations
A. Study and inspection obligations
No North Dakota statute requires a reserve study, an initial study deadline, an update interval, an on-site inspection, or a preparer qualification — not for condominiums, and not for non-condominium HOAs.1 Any study obligation is contractual, and it exists only if the recorded declaration or bylaws call for one. Absent that, commissioning a study is a discretionary call the board makes under its fiduciary duty in section 10-33-45.5
B. Funding obligations
No statute requires either community type to fund reserves or to hit a percentage-funded or dollar target.1 For condominiums, the board sets common-expense assessments under the declaration and bylaws (§ 47-04.1-07, § 47-04.1-11); for non-condominium HOAs, the authority to assess and to reserve comes from the CC&Rs.3 In both cases the director standard of conduct, not a statutory funding rule, constrains the funding decision.5
C. Disclosure obligations
Effective August 1, 2025, Senate Bill 2229 created N.D. Cent. Code § 47-10-02.3. It requires the seller of a condominium unit — or of a property subject to an HOA or condominium project — to hand the buyer, within ten days of a sale agreement, the amount of reserve and capital funds on hand and committed to current or pending projects, a statement of whether the association uses a reserve study, and the current operating and reserve budgets along with a year-to-date financial statement.4 The disclosure reaches both condominiums and non-condominium HOAs, and the buyer can void the purchase contract until the documents arrive and for five days after they do.4 Separately, condominium bylaws that govern the assessment of expenses must stay available to every owner under section 47-04.1-07 — but no statute requires a reserve-specific annual budget disclosure.3
D. Account and governance obligations
No statute makes either community type segregate reserve funds, restrict how it invests them, or protect them from withdrawal.1 Corporate-governance duties still apply to an incorporated association under chapter 10-33 — including the director duty of care in section 10-33-45 and the annual-report requirement — but those are corporate formalities, not reserve rules.5 North Dakota has no dedicated HOA regulator, and current law administered by the North Dakota Real Estate Commission does not require a community-association manager to hold a real estate broker's license.7
Section 4: Recent legislative and judicial activity
A. Recent bills
One bill defines North Dakota's recent reserve activity, and it lands at the point of sale. Senate Bill 2229, from the 69th Legislative Assembly, cleared the Senate 44-2 and the House 87-4, the Governor signed it on March 18, 2025, and it took effect on August 1, 2025 as N.D. Cent. Code § 47-10-02.3. It requires a seller to give the buyer, within ten days of a sale agreement, a defined set of association documents — reserve and capital-fund balances, a statement of whether the association uses a reserve study, and the operating and reserve budgets.4
SB 2229 · 69th Legislative Assembly · 2025
Senate Bill 2229 plants North Dakota's first reserve-related disclosure rule at the closing table. It does not require an association to study or fund reserves. Instead, it requires the seller of a unit in an HOA or condominium project to disclose reserve and capital balances, whether the association uses a reserve study, and the current operating and reserve budgets — and it lets the buyer void the contract until those documents arrive.[4]
| Property managers | Be ready to assemble reserve balances, budgets, and any reserve study within ten days of a request — the seller's ability to close depends on it. |
| HOA board members | Keep reserve figures and budgets current and retrievable, because incomplete records can stall a member's sale. |
| Community association attorneys | Update resale packages and seller-disclosure checklists to cover every item § 47-10-02.3 lists, and advise sellers on the buyer's voidability remedy. |
| Homeowners | As a seller you must disclose reserve and budget information; as a buyer you can void the contract until you receive the documents and for five days after. |
B. Recent appellate rulings
North Dakota's most relevant recent ruling never mentions reserves, but it shapes the money that feeds them. In Industrial Commission of North Dakota v. Gould, 2024 ND 32, the North Dakota Supreme Court held that an HOA's assessment lien did not outrank a previously perfected mortgage — even though the declaration declared the lien "superior and senior to any lien hereafter placed... including the lien of any mortgage or deed of trust."8
Industrial Commission of North Dakota v. Gould, 2024 ND 32
The lender recorded its mortgage on September 5, 2019, and assigned it to the North Dakota Housing Finance Agency the next day. The association's assessment did not exist until at least September 10, 2019, and the association did not file its lien until September 24, 2021. The earlier-perfected mortgage won. The decision never touches reserves directly, but it tells North Dakota associations they cannot lean on declaration text alone to leapfrog a recorded mortgage — which changes how they should value the delinquent assessments that feed operating and reserve budgets.[8]
| Property managers | When you budget for collections, do not assume an assessment lien will recover unpaid amounts ahead of a mortgage holder. |
| HOA board members | Record and perfect assessment liens promptly, and treat delinquent assessments as uncertain revenue when you set reserves. |
| Community association attorneys | Review the declaration's lien language and advise that North Dakota is not a super-lien state, whatever the declaration says. |
| Homeowners | Understand that an association's lien generally ranks behind an earlier-perfected mortgage on your home. |
C. Active legislative debates
No reserve-study or reserve-funding mandate is moving through North Dakota right now. The state's small market and biennial legislature make near-term reserve legislation unlikely, and the § 47-10-02.3 disclosure rule remains the most recent reserve-related change.4
Section 5: National positioning and related coverage
North Dakota sits in the no-mandate group of states. The hard-mandate states fix study intervals and funding rules. California requires that, "at least once every three years, the board shall cause to be conducted a reasonably competent and diligent visual inspection of the accessible areas of the major components," under Civil Code section 5550. Florida requires structural-integrity reserve studies and milestone inspections for condominium and cooperative buildings three stories or higher under Senate Bill 4-D. Maryland requires reserve studies for condominiums (Real Property § 11-109.4) and for qualifying HOAs (§ 11B-112.3, reaching associations with at least $10,000 in component costs), updated at least every five years, under House Bill 107.9,10,11 The disclosure-mandate states ask for less: Colorado, for example, requires a written reserve policy and reserve disclosures without forcing a study on a fixed schedule, under the Colorado Common Interest Ownership Act, section 38-33.3-209.5.12 North Dakota imposes none of this, which places it alongside no-mandate neighbors such as Montana, Mississippi, and Nebraska.1 Its traditional Condominium Ownership Act, and a Court of Appeals that hears only the cases the Supreme Court assigns and convenes rarely, both point the same way: North Dakota resolves reserve disputes through the declaration and the Supreme Court, not through a specialized statutory scheme.13 For a multi-state operator entering North Dakota, the takeaway is simple — your internal reserve standards and the recorded declaration, not a state statute, will drive reserve practice.
Federal frameworks apply to North Dakota associations no matter what the state framework does — the Fair Housing Act, the Americans with Disabilities Act, the Fair Debt Collection Practices Act, the Servicemembers Civil Relief Act, and the OTARD rule all reach community associations here. HOA Weekly updates its North Dakota reserve-studies coverage each quarter as the Legislative Assembly and the North Dakota Supreme Court act.
- Cmty. Ass'ns Inst., Summary of State Reserve Fund Laws (Oct. 2023) (North Dakota entry: no statutory requirement to conduct a reserve study and no statutory requirement to fund reserves) ↩
- N.D. Cent. Code ch. 47-04.1, Condominium Ownership of Real Property ↩
- N.D. Cent. Code §§ 47-04.1-07, 47-04.1-11 (administration, bylaws, and common-expense assessments and liens) ↩
- S.B. 2229, 69th Leg. Assemb. (N.D. 2025) (enacting N.D. Cent. Code § 47-10-02.3, required pre-sale disclosures) ↩
- N.D. Cent. Code § 10-33-45 (standard of conduct for directors) ↩
- N.D. Cent. Code ch. 10-33, Nonprofit Corporations ↩
- N.D. Cent. Code ch. 43-23 (North Dakota Real Estate Commission) ↩
- Indus. Comm'n of N.D. v. Gould, 2024 ND 32 (Docket No. 20230188, decided Feb. 22, 2024) ↩
- Cal. Civ. Code § 5550 (reserve study with visual inspection at least every three years) ↩
- Fla. S.B. 4-D (2022) (structural integrity reserve studies and milestone inspections) ↩
- Md. Code Ann., Real Prop. § 11-109.4 (condominiums); § 11B-112.3 (HOAs); H.B. 107 (2022) ↩
- Colo. Rev. Stat. § 38-33.3-209.5 (reserve study policy requirement) ↩
- N.D. Court Sys., Court of Appeals (hears only cases assigned by the Supreme Court; convenes infrequently) ↩